Business loan agreement and credit agreement

The basic business loan or business loan document is an agreement signed between two parties. The lender or lender undertakes to transfer a specified amount for a given time to the borrower or borrower, who in turn undertakes to return it along with the costs indicated in the contract. However, the business loan and credit agreement is different. What are the differences?

When you want to borrow money, we can ask someone from your family or friends to do it. We can also go to a bank or to a non-banking company, where we will also receive money for our expenses. Of course, in the latter case we have to meet certain requirements.

First of all, a business loan or a basic loan is available for those who have certain creditworthiness, but business loans for people without regular income are also available. It is worth pointing out, however, that we will not get credit, for example a mortgage or car business loan, without checking our creditworthiness first – banks are obliged to check our ability and base their decision on it.

A business loan and credit something else

Here we come to an important issue, namely that both the business loan and the business loan are completely different banking and non-banking products. Often, these terms are used interchangeably, but it is worth pointing out that they are something else according to the law.

The business loan may be granted only by the bank under the terms of the Banking Law. It is therefore necessary to examine the customer’s creditworthiness. business loans are also intentional, that is, we allocate them for a known purpose, for example, to buy a car or build a house. In addition, the business loan must be confirmed in accordance with the law in a written agreement.

On the other hand, business loans are not so demanding – we can take out a business loan for any purpose, both at the bank and in non-bank lending companies . We can also receive it from private persons, for example from a family, a neighbor or a person unknown to us through social lending services. A business loan can also be free, unlike a business loan that has certain costs. What’s more, in the case of business loans for smaller amounts – up to PLN 500, there is no need to prepare a business loan agreement.

Therefore, in the case of business loans, we have to conclude an agreement, but for business loans it is not necessary. It is worth signing it, however, even if the sum of the business loan is lower than PLN 500. At that time, the contract is a confirmation of the transaction between the parties.

What is the business loan agreement and how does the business loan agreement look like?

Generally, both the business loan agreement and the business loan will find the same information. These are the data of the parties to the contract, its subject, ie the business loan along with an indication of its amount, the repayment period, the method of repayment – equal or decreasing installments, the repayment date of individual installments. Also in the case of business loans, we will find information on the purpose of the business loan.

Credit agreements are generally longer than business loans because they contain precise provisions in accordance with Banking Law . In the case of business loans, the contract is often shorter – if any issues are not covered in the contract, then they are considered in accordance with the provisions of civil law.